Biden official says U.S. move to foreign investment should not be too broad
The Biden administration is considering a pilot program to address the risks of foreign investment in China, Commerce Secretary Gina Raimondo said Thursday.
Raimondo said on a Bloomberg News forum that the proposed measure, which would bar U.S. investors from taking stakes in certain Chinese companies, would not be too broad or affect 401(k) or pension plans.
“There’s a lot of American pension funds invested in China and people’s pension money. You certainly don’t want to do anything that has unintended consequences,” Raimondo said. “You don’t want to be too broad…anything too broad hurts American workers and the economy.”
“We don’t want to escalate unnecessarily,” he said. But he said the U.S. does not want China to use “semiconductor technology or artificial intelligence technology in its military that leverages American venture capital.”
Raimondo told Reuters after the forum that it was unclear when the government would finalize any restrictions on foreign investment. She thinks a pilot program is possible. “It’s wise to walk before running because if you get it wrong, there will be consequences that we want to avoid,” Raimondo told Reuters.
When asked how long it would take to finalize the exit rules, Raimondo said, “Certainly months, not years.”
China hawks in Washington accuse American investors of shifting capital and valuable know-how to Chinese technology companies that could advance Beijing’s military capabilities.
Efforts to enact a program to screen foreign investment failed in Congress last year. However, a spending bill signed in December gave the U.S. Treasury and Commerce departments $10 million each to review what is needed to develop a plan to address national security risks from “outward investment” in certain industries.
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